What is Personal Contract Purchase (PCP)?
Personal contract plans (PCP) tend to have a lower monthly payment than HP, even with a maximum term of 49 months, with a large balloon payment at the end of the agreement. You have 3 options at the end; Hand the car back to the finance company, pay off the balloon payment or part exchange against a new car. PCP’s are ideal if you change your car often and most people choose a term that’s equal to how long they plan on keeping the car.

What are the advantages of PCP?

1. Monthly payments on a car financed by PCP are usually lower than if your car is financed by a Hire Purchase agreement.

2. If you decide not to buy the car, you can simply walk away when you have made all your monthly payments over the agreement term.

3. If your car is worth more than the Guaranteed Future Value then you can use that equity towards a deposit on a new car.

How do I get a finance settlment?

Contact your current finance provider for a final settlement. 

What should you consider when option for a PCP?

  1. You will not own the car unless you choose to pay the optional final payment at the end of your agreement.

  2. You will agree an annual mileage from the outset and will be charged for any excess miles.

  3. If you choose to return the car, it must be in a good condition otherwise you could be subject to surplus charges.

I have some questions regarding finance, who do I speak to?

Our centre teams are all trained and SAF qualified, meaning they have the knowledge and information to help you every step of the way. 

What is a Hire Purchase agreement (HP)?
Hire purchase is a method of paying for your car over set monthly payments on a fixed term with a fixed rate of interest. The term can range from 12 to 60 months depending on your circumstances and subject to status you can borrow anything from £1000 to the full value of the car. Once the final payment has been made you own the car outright. We have a wide selection of HP offers at Vantage Motor Group, see our Offers section.

What are the advantages of HP?

1. You will be able to order a new or used car and drive it away without having to buy it outright.

2. Unlike PCP you will not need to estimate your annual mileage and so therefore will not be subjected to any excess mileage charges.

3. Once you have made your final monthly payment, including the option to purchase fee, you will have full ownership of your car. 

What should you consider when opting for HP?

1. Your monthly payments maybe higher than PCP as you are paying off the full value of the car.

2. You will not be able to sell the car without settling your agreement.

3. You will not own the car until you have made all of your repayments.

Can I settle my HP agreement early?

You can normally settle your agreement early by asking the finance company to provide you with a settlement figure. However, the finance company will require you to pay off the difference between what your car is worth, and what you still owe and there may be a difference which is known as negative equity. Contact your current finance provider for your settlement figure.

I have some questions regarding financing my purchase, who should I speak to?

Our centre teams are trained and SAF qualified, meaning they have the knowledge and information to help you every step of the way.

What's the difference between HP and PCP?

In short, the big difference is that at the end of a HP agreement you will own the vehicle. With a PCP agreement, you don’t. Although you do have the option to own the car once the balance owed has been paid. For both finance options you will be required to pay a deposit and pass a credit check.

Worried about getting credit?

If you are worried about credit, you can check for free whether you’re likely to be accepted for vehicle finance, and get an indication of the cost, without it affecting your credit rating. Alternatively, if you would like to discuss your options further, please contact us at Vantage by either chatting to one of our live chat advisors or calling us today.

Here at Vantage, we can give you helpful advice based on your situation and budget, and always have competitively priced finance options available.

Before you sign up to any kind of finance agreement, it is important to make sure you have worked out what you can afford, both in terms of deposit and monthly payments, and are able to commit to the length of agreement.

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